Ka Zeng and Joshua Eastin, Greening China: The Benefits of Trade and Foreign Direct Investment

Excerpt

The detailed and careful analyses in this timely book on China, trade, and the environment provide a fresh perspective on existing theories about the environmental impact of foreign direct investment (FDI). Zeng and Eastin offer convincing evidence that trade and FDI with countries having more stringent environmental regulations favorably impacted the levels of environmental pollution in China’s provinces and the number of firms engaging in voluntary self-regulation. Using multiple sources of data, including FDI and pollution indices in the provinces, a survey of executives in 50 firms in China, and an interesting case study involving Asia Pulp and Paper (APP), one of the world’s largest paper manufacturers headquartered in Indonesia, the authors demonstrate how China’s integration into the global economy has favorably impacted both the country’s environmental regulatory practices and the activities of firms in relevant industries. …